UNCAP LIFE S POTENTIAL A

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1 Indexed Universal Life Insurance Balanced Growth Advantage UNCAP LIFE S POTENTIAL A policy that gives credit when credit s due Insurance products are issued by Minnesota Life Insurance Company in all states except New York. In New York, products are issued by Securian Life Insurance Company, a New York authorized insurer. Both companies are headquartered in Saint Paul, MN. Product availability and features may vary by state. Each insurer is solely responsible for the financial obligations under the policies or contracts it issues. abc

2 We never stop caring for our policyholders At Minnesota Life and Securian Life, we are committed to standing by our clients treating you to a level of respect and dedication you deserve. When you buy life insurance from us, you buy a policy that improves with time and changes with you. Regardless of when you buy your policy, when possible you will be offered the same new features and products as new clients. This makes our company and policies stand out. When you insure yourself, your family or business with us, your policy is not only backed by a company with experience and financial strength - it s backed by a company that believes in treating you like a partner. WHAT S INSIDE What life insurance can do 3 Why Balanced Growth Advantage? 4 How Balanced Growth Advantage works and Lifetime interest crediting 5 Fixed or indexed crediting 6 You get more with our Balanced Index Accounts 7 Loans and partial surrenders 8 Customizing your policy 9 Summary 10 2

3 What life insurance can do for you and your family The main purpose of life insurance is to provide a tax-free death benefit upon your death. 1 Because Balanced Growth Advantage is a permanent policy, it provides lifetime protection and offers tax-advantaged cash value growth you can access throughout your life. The benefits of Indexed Universal Life: Universal The premiums you pay are flexible, allowing you to pay more or less to accommodate budget variations throughout life, or to pay a fixed, consistent amount. You can also change the death benefit amount to align with your ever-changing circumstances. Fixed A fixed crediting option provides a guaranteed minimum interest credit of 2 percent. Indexed Indexed accounts provide the potential for higher interest crediting than traditional fixed-interest policies while providing a floor to protect you from negative earnings. You can choose from four indexed account options: Index Account A with an index crediting growth cap as well as three Balanced Index Accounts with uncapped crediting potential subject to the index allocation. 1 If owner/insured are different, the death benefit will be paid upon death of the insured. Cash value A portion of your premium payment that can grow tax deferred over time and may be used throughout your lifetime. Premiums The regular payments you make on your policy. Death benefit The money beneficiaries receive upon death of the insured. Indexed accounts Accounts that make up all or part of cash value. Interest crediting may be tied to the performance of a stock or bond index. Growth cap The maximum growth or upper limit that may be credited. Floor The minimum growth or bottom limit that may be credited. Index allocation The percentage measuring the portion of the index credit or partial index credit based on the growth in the indices for the Balanced Indexed Accounts. 3

4 Why Balanced Growth Advantage? With Balanced Growth Advantage, you get competitive interest crediting options. It not only protects your assets but helps you grow and enjoy them. If you desire to accumulate funds that you can access for supplemental retirement income, college tuition, a new home or other goals, then Balanced Growth Advantage may be right for you. Balanced Growth Advantage offers: Uncapped growth potential and protection from negative growth (a floor) in the Balanced Index Accounts. 2 Partial credits on accumulation value that is withdrawn from the Balanced Index Accounts prior to the end of the index segment term. ESTATE PLANNING Preserve your legacy by passing on wealth to your children or grandchildren. FINANCIAL FLEXIBILITY Gain the potential to accumulate cash value and access it at any time for life s unexpected emergencies. CUSTOMIZATION Design life insurance protection that s right for you with Balanced Growth Advantage s numerous agreements. 3 RETIREMENT FUNDING Use loans and withdrawals of cash value as a source of supplemental retirement income. BUSINESS CONTINUATION Create a buy-sell arrangement to give a business both short-term continuity and the resources to continue thriving over the long term. TAX ADVANTAGES Pay no income taxes on your cash value growth as long as your policy remains in force. 4 Because earnings aren t reduced by income taxes, your money has the potential to grow faster. CHARITABLE GIVING Use your policy to leave a gift for your favorite charity. DEBT SECURITY AND LIFESTYLE PRESERVATION Help your family maintain their way of life and pay off a mortgage or other debt when you pass away. 2 Balanced Index Accounts are subject to an index allocation. 4 3 Agreements may be subject to additional costs and restrictions. Agreements may not be available in all states, may exist under a different name in various states and may not be available in combination with other agreements. 4 As long as the policy is not a modified endowment contract.

5 How Balanced Growth Advantage works for your benefit 1 PREMIUM You pay premiums. After a premium charge is deducted, the remaining amount is added to an indexed account (creating an index segment) or the fixed account. PREMIUM CHARGE INTEREST CREDITING At the end of an index segment s term, interest is credited to the indexed account based on the performance of the chosen index. Partial index credits are applied to money withdrawn from the Balanced Index Accounts. Interest is credited daily to the fixed account. ADMINISTRATIVE FEES Each month, administrative and insurance charges are deducted from the fixed account first, then indexed accounts. 5 LOANS AND PARTIAL SURRENDERS If you need money, you can access the cash value. 7 5 Depending upon actual policy experience, you may need to increase premium payments to keep the policy in force. 6 Decrease in account value. 2 ACCUMULATION VALUE OR TRANSFERS Retained accumulation value or amounts transferred from other accounts also create index segments. INDEXED ACCOUNT BENEFITS PAID At the insured s death, benefits are paid to your beneficiaries. DEATH BENEFIT 7 Loans and withdrawals will reduce both the cash value and death benefit. Under certain circumstances, policy loans and withdrawals may be subject to income taxation. Consult a tax advisor for specific information. If money is deducted from a balanced indexed account for a policy loan with a fixed policy loan interest rate, a partial index credit will be credited on the amount of money withdrawn from the balanced indexed account. The partial index credit will be calculated based on the partial index credit term. Additionally, a lockout period of 12 months during which no transfers from the fixed account to an indexed and/or balanced indexed accounts will apply. 4 ACCOUNT VALUE Segment term The time period over which index credits are calculated based on the performance of an underlying index. Index segment The portion of an indexed account created from transfers from the interim account or a fixed account and any amount retained in an indexed account at the end of the previous segment term. Agreements Optional benefits you can add to your policy. Buy-sell arrangement An agreement where one person agrees to purchase the financial interest a second person has in a business following the second person s death. LIFETIME INTEREST CREDITING GUARANTEE If your policy ends due to death, policy termination or surrender, its cash value is guaranteed to be credited with at least the equivalent of a 2 percent effective annual interest rate. This guarantee applies regardless of whether you allocated net premiums to the fixed or indexed accounts. Guarantees are based on Minnesota Life s financial strength and claims-paying ability. 5

6 Fixed or indexed interest crediting Compared to most life insurance policies, Balanced Growth Advantage gives you something extra. As an indexed policy, it allows you to allocate net premiums into a fixed account, a choice of indexed accounts or any combination. This gives you more flexibility and the potential for higher interest crediting. Fixed account Rate is guaranteed to never be less than 2 percent annually. Earns interest daily at a fixed rate declared by Minnesota Life. Indexed accounts Balanced Growth Advantage provides you flexibility by offering two types of indexed accounts with four account options: Index Account A and three Balanced Index Accounts. Each option offers different benefits so you can choose the account(s) that meet your needs. Index Account A Index Account A uses an annual point-to-point crediting method to determine the index credits at the end of the segment term. This method uses the index value from only two points in time - the beginning index value compared to the ending index value. The percentage of change in the index determines the index credit, subject to a growth cap (a maximum interest crediting amount for a segment term) and floor (a minimum crediting amount) of 0 percent. Net premium Your premium less any charges and fees. S&P 500 Standard & Poor s Composite Index of 500 Stocks (S&P 500 ) is a popular index for equity indexed life insurance products. Credits are based on 500 of the largest stocks in the United States. Participation rate The percentage to which an indexed account shares in positive changes in the chosen index. Index Account A S&P 500 i with 1-year segment participating at 100% up to growth cap Growth caps change over time as economic conditions vary. Balanced Index Accounts 1, 2 and 3 The Balanced Index Accounts use the Balanced Allocation Strategy (BAS) crediting method, which combines an index component, declared rate component, strategy spread component and participation rate to determine the index crediting rate. The Balanced Index Accounts offer: Uncapped growth potential. 8 A 0 percent crediting floor for downward market protection. Partial index credits when money is withdrawn from the account prior to the end of the segment term. Balanced Index Account 1 BAS S&P 500 with 1-year segment, uncapped 8 Balanced Index Account 2 BAS S&P 500 with 2-year segment, uncapped 8 Balanced Index Account 3 BAS S&P 500 with 5-year segment, uncapped 8 8 Balanced Index Accounts are subject to an index allocation. 6

7 Potentially get more with our Balanced Index Accounts Partial index credits help increase your accumulation value Unlike traditional indexed life accounts, our Balanced Index Accounts provide partial index credits on money that is withdrawn from these indexed accounts prior to the end of the index segment. This ensures you will not lose out fully on index credits: When accumulation value is used for cost of insurance charges, transaction charges or fixed loans. 9 If you partially or fully surrender your policy before the index segment end date. If you pass away during the index segment term. 10 Partial credits use the BAS crediting calculation but do not include the participation rate. Uncapped index options for unlimited growth potential The Balanced Index Accounts also allow you to fully benefit from market growth: No cap means no limits on cash value growth potential. A 0 percent index crediting floor provides protection against negative market performance, meaning you can never have negative index crediting. This graph shows an example of how interest is credited to Balanced Growth Advantage, which offers Index Account A with a cap and 0 percent floor, as well as Balanced Index Account 1 with a 0 percent floor and no cap. This example is based on the performance of a hypothetical index. Based on historical performance over the past 30 years, an indexed account with a crediting cap of 13% would have been limited to index crediting returns 46% of the time due to the cap. 11 With the Balanced Index Accounts, your cash value growth won t be restricted, providing greater index crediting potential than Index Account A if the market has high returns. Negative market performance Positive market performance Hypothetical annual index returns Cap Floor Time in years Hypothetical Index Index Account A Balanced Index Account 1 9 If accumulation value is deducted from a Balanced Index Account for a policy loan with a fixed policy loan interest rate, a partial index credit will be credited on the amount withdrawn from the Balanced Index Account. The partial index credit will be calculated based on the partial index credit term. Additionally, a fixed interest rate loan will begin a 12 month lockout period during which no transfers from the fixed account to an indexed and/or Balanced Index Account will apply. 10 For policies with the Increasing death benefit only. 11 Based on historical performance of the S&P 500 Index from June 30, 1985 to June 30, Crediting caps are subject to change over time as economic conditions vary. 7

8 Financial flexibility when you need it Whether it s supplementing your retirement or an unexpected emergency, Balanced Growth Advantage can support you when you need it most. Loans Loans allow you to borrow money on a tax-free basis by utilizing your cash accumulation at any time after the first policy year even before age 59½. 12 Balanced Growth Advantage offers fixed and variable loan interest options. The difference between these loans lies in how the interest rate charged and interest rate credited for the loan balance are determined. Loan type Description Rate charged Fixed Variable Partial surrenders Interest charged remains constant. Interest is credited at one of two rates based on how long the policy has been in force. Interest charged will vary with an outside index, offering greater interest crediting potential. Interest credited will be the same as the interest credited to the policy s accumulation value up to a maximum rate (cap). 4% fixed rate 3% (minimum rate) or bond rate based on Moody s Corporate Bond Yield Average Rate credited 3.0% (years 1-10) 3.9% (years 11+) 0% minimum up to cap maximum With partial surrenders, you can generally withdraw money from the policy tax-free, based on the amount of premiums paid. This will reduce the policy s accumulation value as well as the death benefit. Your policy s cash value gains and losses are credited on an income tax-deferred basis. Partial surrenders up to your cost basis may generally be taken tax-free as long as your policy remains in force and is not a modified endowment contract. Surrender charges: Surrender charges apply to your contract for ten years from inception (or face amount increase) if you surrender your policy. For surrender charges specific to your policy, refer to a policy illustration. Loans are not subject to surrender charges after the first policy year. Cost basis The total contributions of premiums to a life insurance policy, less the total amount of tax-free distributions taken from the policy. Modified endowment contract A life insurance policy that exceeds maximum premium funding allowed by the federal government. CAP ON VARIABLE RATE CHARGED The rate charged on variable loans for Balanced Growth Advantage policies is capped at 1% above the current fixed crediting rate. 12 As long as the policy is not a modified endowment contract. Transaction charges apply to partial surrenders. Partial surrenders and loans are allowed after the first policy year. Loans, partial surrenders and withdrawals will reduce both the cash value and death benefit. Under certain circumstances, policy loans and withdrawals may be subject to income taxation. Under current tax laws, accumulation value is credited on an income tax-deferred basis. Consult a tax advisor for specific information. This information is accurate unless the policy is a modified endowment contract. 8

9 Customize your policy You can tailor and expand your Balanced Growth Advantage policy with the help of your financial advisor. Options you can add to your policy include: Accelerated Benefits Agreement Allows you to access a portion of your death benefit in the event of terminal illness. There is no charge for this agreement. Early Values Agreement Exchanges a separate monthly charge for no surrender charges. Guaranteed Income Agreement (GIA) 13 Provides a guaranteed lifetime income stream at an eligible exercise date with a guaranteed interest rate. Guaranteed Insurability Option Agreement Provides future options to increase coverage without underwriting between the ages of 22 and 40. Inflation Agreement Increases the face amount of the policy every three years based on increases in the Consumer Price Index (CPI). Overloan Protection Agreement Prevents an outstanding policy loan from terminating the policy, even if the accumulation value is insufficient to cover policy charges. Premium Deposit Account Agreement Provides the opportunity to maximum-fund a life insurance policy through a series of pre-scheduled fixed payments. Term Insurance Agreement Provides additional temporary life insurance up to four times your base coverage. Waiver of Charges Agreement Waives monthly charges by Minnesota Life if you are totally and permanently disabled before age 60. Waiver of Premium Agreement Waives your policy premium if you become totally and permanently disabled before age Policyholders who add the GIA should take into consideration that the policy accumulation value on the exercise-effective date may not be sufficient to continue providing the minimum benefit payment until the insured s age 121. If this occurs, it will not be possible to exercise the GIA. Minnesota Life believes the Policy will continue to qualify as life insurance under the Internal Revenue Service Code ( the Code ) after the GIA exercise-effective date and that distributions and loans made under the terms of the GIA will generally not be taxed to the policyholder. However, the IRS or the courts could reach a different conclusion. Policyholders who have added the GIA should consult a tax advisor regarding the tax treatment of distributions and loans under the GIA. Since the Policy s death benefit will be reduced to the minimum amount allowable under the Code after the exercise-effective date, policyholders should consider the impact on their individual circumstances and their need for death benefit before exercising the GIA. There is no charge for the GIA when the Policy is purchased; however, we will assess a one-time charge against the Policy accumulation value on the exercise-effective date. When the GIA is exercised, all other riders will be removed from the policy. Additional agreements may be available. Agreements may be subject to additional costs and restrictions. Agreements may not be available in all states, may exist under a different name in various states and may not be available in combination with other agreements. 9

10 Balanced Growth Advantage Indexed Universal Life Insurance is for people who want: A potential lifetime of life insurance protection with uncapped accounts to maximize index crediting potential. Tax-deferred, supplemental retirement income. Accelerated cash value accumulation growth potential from partial index credits on policy charges. Flexible premium payments and life insurance coverage to fit changing needs. You can increase your assets and provide for those who depend on you. Get the benefits you need to protect your family and the flexibility you want for retirement. Talk to your financial advisor today. 10

11 EASY STAYING CONNECTED IS EASY We make it easy for you to access information about your Balanced Growth Advantage policy: Visit the eservice Center at securian.com. Choose Life insurance under the Account Access menu on the left of the page. Review your annual statement outlining current policy status and changes you made during the past year. We are SECURIAN You may not have heard of us. Boasting is not our strong suit. But we are one of the nation s largest and strongest financial services providers. Securian provides retirement solutions, investments and insurance through our subsidiaries, including Minnesota Life. Minnesota Life issues our life insurance policies 14 and has been a respected presence in the industry for more than a century. For more information about the rating agencies and to see where our ratings rank relative to others, visit securian.com/ratings. WE ARE A highly rated company headquartered in St. Paul, Minnesota. WE DO What s right. Our strong record of transparency, compliance and ethical conduct sets us apart. WE ARE A trusted long-term partner with a laser-sharp focus on helping people reach their goals now and in the years ahead. 14 In all states except New York. In New York, policies are issued by Securian Life Insurance Company, a New York authorized insurer. Both companies are headquartered in Saint Paul, MN. Product availability and features may vary by state. Each insurer is solely responsible for the financial obligations under the policies or contracts it issues. 11

12 The Indexed Universal Life Series is designed first and foremost to provide life insurance protection. While the interest crediting options available with these products are attractive for cash value accumulation, your fundamental objective in buying the product should be the peace of mind that the life insurance protection provides to you and your family or business. Life insurance products contain fees, such as mortality and expense charges, and may contain restrictions, such as surrender charges. One can lose money in these products. Guarantees are based on the claims-paying ability of the issuing insurance company. This material may contain a general analysis of federal tax issues. It is not intended for, nor can it be used by any taxpayer for the purpose of avoiding federal tax penalties. This information is provided to support the promotion or marketing of ideas that may benefit a taxpayer. Taxpayers should seek the advice of their own tax and legal advisors regarding any tax and legal issues applicable to their specific circumstances. Index Account A employs a point-to-point interest crediting method with one-year index segments established monthly. Interest credits for Index Account A index segments may range from 0% up to the maximum for that segment. This policy guarantees that the total interest credited over the life of the policy will not be less than a 2.00% effective annual interest rate. The Balanced Index Accounts employ a Balanced Allocation Strategy with one-year, two-year and five-year index segments - except where noted - established monthly. The Balanced Allocation Strategy blends an equity indexed component, a declared rate component, a segment spread component and a participation rate component. Interest credits for any Balanced Index Account segment will never be less than zero. These policies guarantee that upon surrender, lapse or death of the insured interest will be calculated using an annual minimum interest rate of at least 2.00%. The underlying indices only recognize the changes in stock prices and do not include any dividend returns. While the policy and the Indexed Accounts do not actually participate in the stock market or the S&P 500 Index, and one cannot invest directly in an Index, the performance of the underlying index may exceed the offered indexed growth caps for Indexed Accounts. Interest crediting within these accounts will vary based on the movement of the investments within the underlying index. Should the index have 0% growth or decline, policy owners bear the risk that no Index credit will be given to the account. Administrative and insurance charges are deducted every month, regardless of whether premium outlays are made. Depending upon actual policy experience, the Owner may need to increase premium payments to keep the policy in force. i S&P 500, Standard & Poor s 500 index, Standard & Poor s, S&P, S&P 500, Standard & Poor s 500, and 500 are trademarks of Standard & Poor s and have been licensed for use by Minnesota Life Insurance Company ( Minnesota Life ) and Securian Life Insurance Company ( Securian Life ). The Indexed Universal Life Series Policies ( the Policies ) are not sponsored, endorsed, sold or promoted by Standard & Poor s and Standard & Poor s makes no representation regarding the advisability of investing in the Products. The Policies are not sponsored, endorsed, sold or promoted by Standard & Poor s ( S&P ) or its third party licensors. Neither S&P nor its third party licensors makes any representation or warranty, express or implied, to the owners of the Policies or any member of the public regarding the advisability of investing in securities generally or in the Policies particularly or the ability of the S&P 500 (the Index ) to track general stock market performance. S&P s and its third party licensor s only relationship to Minnesota Life and Securian Life is the licensing of certain trademarks and trade names of S&P and the third party licensors and of the Index which is determined, composed and calculated by S&P or its third party licensors without regard to Minnesota Life and Securian Life or the Policies. S&P and its third party licensors have no obligation to take the needs of Minnesota Life and Securian Life or the owners of the Policies into consideration in determining, composing or calculating the Index. Neither S&P nor its third party licensors is responsible for and has not participated in the determination of the prices and amount of the Policies or the timing of the issuance or sale of the Policies or in the determination or calculation of the equation by which the Policies are to be converted into cash. S&P has no obligation or liability in connection with the administration, marketing or trading of the Policies. NEITHER S&P, ITS AFFILIATES NOR THEIR THIRD PARTY LICENSORS GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS OR COMPLETENESS OF THE INDEX OR ANY DATA INCLUDED THEREIN OR ANY COMMUNICATIONS, INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATIONS (INCLUDING ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P, ITS AFFILIATES AND THEIR THIRD PARTY LICENSORS SHALL NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY FOR ANY ERRORS, OMISSIONS OR DELAYS THEREIN. S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE MARKS, THE INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL S&P, ITS AFFILIATES OR THEIR THIRD PARTY LICENSORS BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY OR OTHERWISE. Securian Financial Group, Inc Robert Street North, St. Paul, MN Securian Financial Group, Inc. All rights reserved. Policy form numbers: ICC F A DOFU